A view from the stand at Public Finance Live 2026

Revenues and Benefits squeeze, from two directions

Debt and arrears were a recurring concern for two connected reasons.

For some councils, the pressure is straightforward: budgets are tight, and collecting more effectively is one of the few levers available to help balance them.

For others, the pressure is applied via LGR, with new authorities inheriting collection rates, systems and debt books that vary significantly across the districts being brought together. These variances become a problem the moment the new authority needs a single, coherent position.

Either way, rising debt is not simply a Revenues and Benefits issue. It affects bad-debt provision, recovery costs, cash flow into the council and the funding available for services.

It also becomes harder to address over time. Some historic debt remains recoverable, some needs a different approach, and some may ultimately need to be written off.

The challenge is understanding which is which, and during LGR, where predecessor councils may have very different debt profiles and recovery practices, that challenge increases.

Adult Social Care debt needs a different approach

A theme that came up more than we expected was Adult Social Care (ASC) debt.

It’s growing, and for finance teams it carries a different risk profile to most other council debt. ASC debt tends to sit for longer, carries a higher likelihood of write-off, and needs careful treatment in bad-debt provisioning.

It’s also debt that sits alongside genuinely vulnerable residents, often at difficult points in their lives, which makes the usual recovery playbook harder to apply. Get the approach wrong and the financial risk compounds, with escalated cases, higher write-off rates, and reputational and complaints exposure on top.

The finance leaders we spoke to were clear this isn’t a case of choosing between financial discipline and a sensitive approach. The two need to work together. Early identification of vulnerability, understanding a resident’s actual circumstances, and adjusting the recovery approach accordingly tends to produce both a fairer outcome for the resident and a more accurate, defensible position on the council’s own balance sheet.

Testing the numbers, not just the narrative

Our conversations at PFL moved quickly as finance leaders wanted to move from the general challenge to the underlying figures. Not for reassurance, but to stress-test their own assumptions.

For councils involved in proposed reorganisations, that meant comparing collection performance, debt levels, systems and benefits claims performance across the authorities that may come together.

The value wasn’t in the comparison itself, but in what it surfaced: where the risk actually sits, which planning assumptions need testing before they go into a business case, and what a defensible opening balance sheet position might look like for the new authority.